This Reliance-backed stock hits record high on robust Q3; surges 35% in 2 months

Shares of Just Dial rallied over 8% to hit their fresh 52-week high of ₹945.80 on Monday after the local search engine provider reported robust earnings in the December quarter of the current fiscal. The Reliance Industries-backed stock has had a stellar run the last two months, rising more than 35% from ₹699 levels on November 17, 2023. Reliance Industries is the majority stakeholder in the company, owning 63.85% shares through its retail arm, Reliance Retail Ventures (RRVL).

Paring previous session losses, Just Dial shares opened higher at ₹906.70, up 4% against Friday’s closing level of ₹871.65 on the BSE. During the session so far, the largecap stock gained as much as 8.5% to hit an intraday high of ₹945.80. The counter has rebounded 67% from its 52-week low of ₹565.20 touched on March 16, 2023.

At 1:10 PM, shares of Just Dial were trading at ₹902.40, up 3.5%, while the market capitalisation stood at ₹7,673 crore. There was a surge in volume as 1.56 lakh shares changed hands over the counter as compared to two-week average of 0.46 lakh stocks.

In the last one year, Just Dial shares have soared nearly 40%, while it gained 13% in six months. In the last one month, the counter added 13.5%, whereas it climbed 10% in the past one week. The stock has risen in the last 12 out of 13 sessions and gained 20% during the same period.

Just Dial shares got a boost today after the company reported a 22.3% rise in net profit to ₹92 crore for the quarter ended December 31, 2023, against ₹75.3 crore in the same period last year. Revenue for the quarter surged 39.32% to ₹221.37 crore compared with ₹158.89 crore in the corresponding period last year.

The operating EBITDA stood at ₹60.4 crore, with a margin of 22.8%. The EBITDA margin witnessed 1,054 bps YoY expansion, led by top line growth and strong cost controls, both on employee costs and other expenses.

As per the company, the total traffic (unique visitors) of the search engine provider stood at 165.9 million in Q3 FY24, up 5.8% YoY and down 3.4% QoQ. Total active listings stood at 41.6 million as on December 31, 2023, an increase of 18.8% YoY and 3.5% QoQ.

Post Q3, JM Financial maintained a ‘Buy’ rating on the stock with a revised 12-month target price of ₹1,010, an upside potential of 15.7% from the current market price. “Just Dial’s accelerated margin recovery towards pre-Covid levels continued as it reported the 7th consecutive quarter of sequential margin expansion, a cumulative improvement of 26.5ppts,” the brokerage says in a report.

“However, paid subscriber additions (+8.6% YoY), cash collections (+10% YoY) and unique visitor traffic (+5.8% YoY) trends were not very encouraging. We believe this slow-down is partly due to focus on profitability and expect the management to re-focus on growth acceleration in the coming quarters,” it adds.

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